Mining giant Vedanta on Wednesday announced it will sell 3.31% equity stake in Hindustan Zinc Ltd or about 14 crore shares at a floor price of ₹486 per share.
The floor price of Hindustan Zinc OFS is more than 15% higher than Wednesday’s closing price of ₹571.75 per share.
Vedanta had earlier informed the stock exchanges that it would sell 11 crore shares or 2.6% equity stake in Hindustan Zinc through OFS. The OFS will close on Monday, August 19.
The disinvestment of 14 crore Vedanta shares will fetch Vedanta around ₹6,800 crore at the floor price, while at Wednesday’s closing price, the fund raise would be ₹8,000 crore.
At the end of the June quarter, Vedanta held 64.92% stake in Hindustan Zinc, while the government held 29.54%.
The OFS is part of Vedanta’s debt-restricted strategy to deleverage its balance sheet. Vedanta’s debt as of June 30, 2024 stood at ₹61,324 crore.
“The offer is being made by the seller to inter alia obtain access to funds for growth and expansion purposes and optimization of the capital structure of the company,” Hindustan Zinc said in a filing.
Vedanta reported a 36% rise in consolidated net profit to ₹3,606 crore for the April-June quarter of 2024-25, compared to ₹2,640 crore in the year-ago period. Total income increased to ₹36,698 crore in the quarter under review from ₹34,279 crore in June quarter of FY24.
Vedanta raised ₹8,500 crore through Qualified Institutions Placement (QIP) of 19.31 crore equity shares at ₹440 per share in July. At 1:06 pm, Hindustan Zinc shares were trading 7.7% lower at ₹539.4 on the NSE.
On the other hand, Vedanta shares were trading 0.62% higher at ₹422.8 on NSE.
